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By François MASQUELIER, CEO of Simply Treasury
After a few years of low default levels, we could be faced with major losses at bank level, particularly following the sharp and rapid rise in interest rates. We can expect to see many bankruptcies or "chapter 11" refinancings over the next 12 to 24 months. Interest rates will remain high for longer than anticipated, creating huge additional interest costs. Far too many companies have favored the lowest cost over diversification. They risk paying a heavy price.
The economic difficulties of certain sectors will affect their profits and negatively impact their credit ratings, thereby increasing their cost of financing. We realize the value of liquidity and access to credit, as well as the virtues...
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